KOLKATA: ITC Chairman YC Deveshwar will step down from his executive role in February next year and stay on as non-executive chairman until 2020, putting to rest speculation over the retirement of one of India’s longest-serving company bosses after two decades at the helm.

In a stock exchange notice late on Tuesday, the company said Deveshwar, 69, would assume the non-executive role for three years starting February 5, 2017. ITC, which hasn’t announced his successor, said Deveshwar will guide and mentor the new executive management that the company puts in place.

ITC made sweeping changes to its top management last year, elevating two executives in their early 50s. Sanjiv Puri was made director responsible for handling more than 80 per cent of the conglomerate’s revenue and B Sumant became president of the FMCG business.

Analysts and company trackers tip Puri as being the frontrunner to succeed Deveshwar.

Deveshwar first indicated in 2011 that he would move into a non-executive role at the company that has interests in cigarettes, FMCG, hotels, lifestyle retail, paper and packaging, and agri-business.

When he took charge as ITC chairman in January 1996, gross revenue was less than Rs 5,200 crore. That has grown 10-fold to Rs 51,582 crore. In the same period, total shareholder returns have grown at a compound annual growth rate of 23.3 per cent. Deveshwar also served as chairman of state-run Air India for a few years in the early 1990s.

Corporate India paid fulsome tribute to Deveshwar.

Marico chairman Harsh C Mariwala said he had taken ITC to great heights, especially with the diversification away from tobacco.

"But at some stage you need to give a chance to others to succeed," he said.

"I am sure in an organisation like ITC with multiple profit centres, there would be many able in-ternal candidates and they should fight to choose the right candidate."

Britannia Managing Director Varun Berry said Deveshwar was a legend. "He has moved from strength to strength across categories and redefined rules. It will be tough to have any successor fill his large shoes," he said.

Analysts said Deveshwar’s biggest success has been the diversification that Mariwala referred to. This has paid off handsomely as the cigarette business comes under greater regulatory and taxation pressure, denting demand.

Deveshwar wants the FMCG businesses to hit a revenue target of Rs 1 lakh crore by 2030 and he’s been putting in place the growth drivers necessary to achieve this.

The non-cigarette FMCG business crossed Rs 10,000 crore in sales in the last fiscal year.

With new challenges on the horizon, this would be a good time to hand over charge to the next generation, experts said.

"ITC needs young blood and fresh ideas to fight the Unilevers and Patanjalis of the world," said Abneesh Roy, senior vice-president at Edelweiss Securities.

"Most of the rivals have young managers to lead the company and, over the last two years, ITC has been transitioning management toward the younger generation."

The succession story became tinged with drama last year when two favourites in the race, Kurush Grant and PV Dhobale, stepped down from the board and announced their retirement. The rise of Puri and Sumant accelerated after that.

Deveshwar has earned several accolades during his tenure as ITC chairman. Harvard Business Review ranked him seventh best performing CEO in the world in 2012, alongside icons like Apple’s Steve Jobs. In 2011, he was conferred the Padma Bhushan.